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Foxconn Workers Getting Raise With Apple Subsidies 284

Posted by Soulskill
from the damage-control dept.
hackingbear writes "Workers at Taiwanese electronic outsourcing manufacturer Foxconn are getting a pay raise after a series of 13 suicides, including three in three consecutive days. According to an article by state-run newspaper China Daily, Apple concluded that the main cause of the suicides is low wages. (The media has also attributed the suicides to a variety of other factors — everything from the semi-military style of management, to long overtime, to China's one-child policy, and Foxconn paying too much compensation to the family of suicide workers, thereby encouraging copycat suicides.) Apple plans to subsidize raises using its own products (Google translation; Chinese original here) — the first one being the iPad. This would raise the outsourcing cost from 2.3% to 3% of the iPad's sales price. The article does not say the amount of the raise per worker, but it is rumored to be about 20%, according to other Chinese news sources."
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Foxconn Workers Getting Raise With Apple Subsidies

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  • by deathcow (455995) * on Monday May 31, 2010 @04:12PM (#32410204)

    That enough of their souls are still poured into these incredible, sleek products to maintain the extremely high level of magic and wonder we've become accustomed to finding in each amazingly designed box.

  • by Space cowboy (13680) * on Monday May 31, 2010 @04:13PM (#32410208) Journal
    Because despite the fact that FoxConn make stuff for all sorts of people in the consumer electronics world, all the bile and invective seems to fall on Apple's shoulders.

    No doubt, Apple actually trying to help will be seen negatively too - let's see if any of the subsequent comments say so (my money's on yes...). Honestly, the anyone-but-apple brigade make the fanboys look calm, collected, and sane.

    Simon
    • by King_TJ (85913) on Monday May 31, 2010 @04:16PM (#32410238) Journal

      Exactly! These people were building products for Dell too (among other well-known computer companies). Wonder if we'll see Dell step up to the plate and offer a larger percentage of their profits to these folks as a pay increase? (I'm betting not.)

      • Re: (Score:3, Interesting)

        by Qwavel (733416)

        I agree that Apple has been subject to unfair criticism in regard to this problem. This problem is not about Apple in particular - it is more about conditions in China in particular. For example, let's remember the huge number of Chinese miners who die every year due to unsafe conditions.

        By the same token, Apple's offer to subsidize their wages is equally meaningless, though understandable given the unfair criticism they were subject too.

        The changes that are needed are more fundamental.

        Perhaps what we nee

      • Re: (Score:3, Interesting)

        by Hadlock (143607)

        Can you imagine being so poor and destitute, with so little prospects for the future that taking your own life for profit seems like the best way to help your family in the long run? All the while some American is working 20 hours a week managing the manufacturing of the product from his pool overlooking some valley in California; his biggest worries is whether or not he can afford his wife buying her third convertible this week, and if he is going to be able to make it down to the yacht club this Sunday. I

        • by jcr (53032)

          Plantation slaves in the deep south had it better than many asians working in factories today.

          Careful with the heresy, there. If you suggest that slavery in America wasn't the most wretched situation that has ever existed in history, you might be tagged as a racist.

          -jcr

        • Can you imagine being so poor and destitute, with so little prospects for the future that taking your own life for profit seems like the best way to help your family in the long run? All the while some American is working 20 hours a week managing the manufacturing of the product from his pool overlooking some valley in California; his biggest worries is whether or not he can afford his wife buying her third convertible this week, and if he is going to be able to make it down to the yacht club this Sunday

          Yes, because that's what life is like for your average silicon valley worker...

          Plantation slaves in the deep south had it better than many asians working in factories today.

          How so?

          • by jcr (53032)

            As it happens, slaves in the south did tend to be treated better than factory workers in the north, because if a slave died, that was a significant economic loss to the slaveholder. Thomas Sowell's essays on slavery have mentioned that in many cases, Irish immigrants were given more dangerous tasks where it was too expensive to risk a slave.

            -jcr

            • I've never liked this argument. A similar argument is made (and again, there are valid points!) that the poor whites in the south had it even worse than the blacks. At least blacks could count on regular meals, poor white farmers could count on nothing.

              But black couldn't learn to read. They couldn't move to another farm. They couldn't own land. Their families could be split up on a whim. If they ran away they would be beaten and perhaps killed. And they were property.* (these are of course generalization an

        • by sqrt(2) (786011)

          It is the inevitable result of a capitalistic system that allows the free movement of capital, but not the free movement of labor. Exploitation is going to remain the reality for someone, somewhere in the world until part of that equation changes.

    • Because despite the fact that FoxConn make stuff for all sorts of people in the consumer electronics world, all the bile and invective seems to fall on Apple's shoulders.

      Actually, four other major companies started inquiries as well. Apple seems more open about it (they perform regular audits and publish them openly), more willing to take action, and they get more press over these issues.

    • Re: (Score:3, Funny)

      by maxume (22995)

      I blame Apple for the coming increase in suicide rates at competing factories.

    • Re: (Score:2, Insightful)

      by Anonymous Coward

      More important than the fact that Foxconn makes electronics for just about everyone, is that these suicides aren't statistically surprising. I don't have the numbers, but I recall some commenters on previous Slashdot stories working through the math - basically, the factory employs tens of thousands (?) of workers, and China already has a high suicide rate. The suicide rate in this factory, per capita, was actually *lower* than China as a whole.

      I believe there were seven or eight suicides when that other ar

    • by morgan_greywolf (835522) on Monday May 31, 2010 @04:35PM (#32410474) Homepage Journal

      Because despite the fact that FoxConn make stuff for all sorts of people in the consumer electronics world, all the bile and invective seems to fall on Apple's shoulders.

      Probably because Apple products are 2-3x more expensive than those of their competitors. It's well-known that Apple's profit margins are extremely high compared to their competitors, and that makes people think that perhaps Apple is a bit greedy.

      I'm not saying it's deserved or anything like that, but I can definitely see why people think that way.

      • by mr_matticus (928346) on Monday May 31, 2010 @07:13PM (#32412188)

        There's no question that Apple products carry a higher average price than similar products at other companies, but it's absurd hyperbole to claim 2-3x higher, especially based on gross margin. The logic fails entirely since all of this data is part of their corporate financial reports:

        Probably because Apple products are 2-3x more expensive than those of their competitors.

        That would imply that, given other manufacturers having a profit margin of 1%, that Apple would have a gross profit margin of 51 to 68%. Given another manufacturer's more realistic gross margin of 25%, that would mean that Apple's profit margin would be 63%-75%. That is of course not the case.

        Apple's gross margin is closer to 40% (which is indeed higher than most competitors), which means that assuming identical production costs and business costs, Apple's prices are about 15% higher as an absolute cap.

        But gross margin isn't net profit, and it's net profits that are the subject of so much jealousy--gross profit less overhead, in other words. Apple does a lot of its engineering work in house (hiring an OEM to make something you designed is much cheaper than buying something someone else designed from that OEM), and a simple walk through their SEC-reported financials reveals that they also have lower per capita business costs than Dell or Acer, which amounts to a price savings--we'll say it's in the 5% ballpark (though in reality, it's probably a bit more).

        That makes for an 'Apple tax' of at most 10% in shelf price--hardly "2-3x" and similar to the higher-margin premium lines at HP and Dell that subsidize their unnaturally discounted rock-bottom lines.

        It's well-known that Apple's profit margins are extremely high compared to their competitors,

        Even if it were double the gross margin of their large competitors (and the difference isn't that large), it would amount to a price difference of ~25%, about one-quarter to one-eighth your claim.

        In other words, if a product costs Dell $100 to make and grosses 25%, with $13 overhead, net profit is $12 of the $125 sales price. The same product costs Apple $98 to make and grosses 40%, with $10 overhead, making net profits $29 of the $137 sales price. The consumer pays just about 9% more at the store (nowhere near double), but Apple ends up with more than double the profit in dollars.

    • Re: (Score:3, Insightful)

      Apple invests heavily in marketing. The focus of their marketing is that they are a different company, and they target leftish artist, hipster types. They don't portray themselves as being far different from other companies interested only in the bottom dollar. We aren't surprised when a large company like Dell does business with a large factory in China that is plagued by suicides. We are surprised, not the /. crowd but consumers and their target base in general, that Apple is there, too. That's what
      • I know I'm going ot be hit with "troll" or "underrated" following. I've been modded down before for just pointing out a fact. Hell, the post you were replying has already been hit by the anti-apple folks. Still, let me reply to this:

        Apple invests heavily in marketing.

        I'm not going to say that Apple doesn't invest in marketing. They do. But they are not "heavily" investing either. I've read several articles that say so. This article [cnn.com] is one of them. There's several others. Many here at /. say that Apple is

      • You know who is a big Apple fan and regularly talks about Apple products?

        Rush Limbaugh. He is of course squarely in the middle of the leftish artist hipster type ;-)

        I guess I would say, stereotypes are stereotypes. It's definitely true that Apple markets itself that way, but I don't think there's much reality of that being the main user demographic segment.

        I would also say more so the reason that Apple gets covered instead of Dell is that Apple is a corporation that people have an image of, a face they know

    • by mooglez (795643) on Monday May 31, 2010 @05:34PM (#32411190)

      Because despite the fact that FoxConn make stuff for all sorts of people in the consumer electronics world, all the bile and invective seems to fall on Apple's shoulders.

      No doubt, Apple actually trying to help will be seen negatively too - let's see if any of the subsequent comments say so (my money's on yes...). Honestly, the anyone-but-apple brigade make the fanboys look calm, collected, and sane.

      Simon

      In Finland, all these Foxconn suicides have been reported as happening at a "Nokia contractor", no word of Apple in any of the news posts.

    • I think your summary is simplistic. Apple's move here is nice but it does nothing to give their users freedoms they deserve (like controlling their own computers so they're not victims of Apple's "kill switch" where Apple can remotely deny any user some program on Apple's whim). This move does nothing to provide developers with reasonable terms for distributing programs on their app store (EFF has highlighted the awful terms). And Apple can decide to discontinue this at any moment, returning the workers

      • Pardon me, but I think people committing suicide due to manufacturing conditions is nothing whatsoever to do with AppStore policies. You cheapen their deaths by attempting to link the two. For shame.

        Simon
  • What about.. (Score:5, Insightful)

    by JonJ (907502) <jon.jahren@gmail.com> on Monday May 31, 2010 @04:19PM (#32410266)
    The other companies that are getting their components from Foxconn? Are they doing anything?
    • by phorm (591458)

      Foxconn also sells branded mainboards of their own, etc. How about they just increase the pay at their factories, and up prices a buck or two? Two bucks means nothing to me, if they want to pass that onto the consumer I'm willing to open my wallet.

      • Re: (Score:3, Insightful)

        by am 2k (217885)

        Since all middlemen's shares of the price are percentage-based, raising the price two dollars at the factory probably means that the product will cost an additional $10 or more in the stores

  • Dang (Score:4, Funny)

    by oldhack (1037484) on Monday May 31, 2010 @04:28PM (#32410380)
    I wish my coworkers jumped off the building.
    • by vlm (69642)

      I wish my coworkers jumped off the building.

      Which leads directly to even more

      ... long overtime ...

      That strategy might not be effective.

    • You scored high on the empathy quiz, I can tell.
  • by Gavin Scott (15916) on Monday May 31, 2010 @04:29PM (#32410404)

    I'm under the impression that the workers there already make relatively more than most similar jobs, and a 20% raise doesn't seem like it will make much of a life-changing difference for anyone (especially if they don't have time to spend it :P)

    And just how far can money go to compensate you for hellish working conditions?

    So why not give them some more breaks / shorter hours each day?

    G.

    • I'm under the impression that the workers there already make relatively more than most similar jobs

      Yeah, they're making decent wages for the area.

      And just how far can money go to compensate you for hellish working conditions?

      Agreed, it would make more sense, but then we don't have all the facts. Hopefully the auditors know what they're doing. Part of the problem was the family being given ten year's pay as compensation. Imagine that in the US. It would lead to a rash of suicides as well.

    • by butterflysrage (1066514) on Monday May 31, 2010 @04:47PM (#32410578)

      ok, but why are they working massive overtime? Is it because the job requires them to ("do it or you're fired") or is it the pay that requires them to ("If I don't pick up 6 extra shifts I can't pay my rent next month").

      While the 20% will not help the first case, it would make quite the impact on the second...

      • Plus it pays for a game console, new computer... a night out with your wife... etc.

        If you or a family member has a health problem, 20% higher wages can mean a lot.

      • Re: (Score:3, Informative)

        by amake (673443)

        Peter Hessler covers this very well in Country Driving [amazon.com]. Young migrant workers flock from the poor inland regions to the coasts looking for factory work. They want to work as much overtime as possible 1) because they want to earn as much money as possible as quickly as possible, and 2) because they are far from home and aren't interested in spending time or money on leisure (their "real lives" are back home, and they've come out solely to work).

        Because of this, jobs offering more working hours and less vacat

    • I'm under the impression that the workers there already make relatively more than most similar jobs, and a 20% raise doesn't seem like it will make much of a life-changing difference for anyone (especially if they don't have time to spend it :P)

      And the 20% doesn't make a difference for their family? *I* would be thrilled with a 20% wage increase. At the lower end of the wage scale, each dollar (or renminbi) is even more important, as instead of going to luxuries it can go to basic necessities (and things like education for children)

      And just how far can money go to compensate you for hellish working conditions?

      So why not give them some more breaks / shorter hours each day?

      Let's see, the workers ALREADY chose to work in what you describe as hellish working conditions. Does that tell you anything?

  • but it got rejected.
  • I'm sure they're happy to have a bit more money but if you're working serious overtime I'd think they'd rather work fewer hours rather than some pittance of a pay rise.
  • By comparison (Score:5, Informative)

    by jmichaelg (148257) on Monday May 31, 2010 @04:40PM (#32410510) Journal

    I got curious as to how Foxconn's suicide rate compared to other groups. The United States' suicide rate [wikipedia.org] is 11.1 per 100,000 people. Foxconn employs somewhere around 800,000 people [economist.com](!) which means by the end of the year, you'd expect a death count by suicide of around 90 people.

    If the current rates holds, there'll be 50 more Foxconn employees alive at year's end than there will be Americans from a comparably sized city.

    • Re: (Score:2, Insightful)

      by pandrijeczko (588093)

      ...and that's the problem with the good old "globalAmericanisation" plague inflicting our planet - this idea that if a statistic says it's "within acceptable limits" then everything is okay and nobody needs to do anything about it.

      This is why we now have things like huge interest rates and high insurance premiums - because in both cases, there is an "accepted" level of loss or fraud that nobody in the organisation does anything about, apart from making it more expensive for honest people who have to pay inc

      • It's been shown that you have an infinitesimally small but real chance of not actually existing. It's difficult to aim for 100% when the best reality itself can offer is 99.9999999999999999999999999999999999999999999999999999999999999999%

        I blame Planck myself.
         

      • I don't get your post. 100% of just about anything is impossible. There's "no concept of 100%" because most people have realized that it's impossible! believing in easy solutions and that 100% solutions are a somewhat childish worldview.

        It's like Mike Tyson said..."Everybody's got a plan, until you get hit." You can have the best contingency plans in the world, but invariably, SOMETHING is going to go wrong. Something unexpected and/or out of your control is going to pop up at some point.

        Likewise here, peop

        • The point I'm trying to make is that if you *stop* at 95% or 99.9% then at that point you have accepted a degree of failure - and whilst I accept 100% may be unachievable in many scenarios, continually striving to try to get to 100% should also always be the case.

          The problem with statistics is that they only mean something to those who are outside of the system being statistically measured. For example, if you're a potential bank customer faced with going to one bank that states that only "95% of our custom

      • ...and that's the problem with the good old "globalAmericanisation" plague inflicting our planet - this idea that if a statistic says it's "within acceptable limits" then everything is okay and nobody needs to do anything about it.

        It’s a far worse dynamic: When people still aren’t doing as bad in one place, the government / bosses will argue that because those others are worse, one can still go down. (Which of course is a logic fallacy.)
        And then one of them by random chance gets a bit worse, and everyone else gets an excuse to make it even worse.
        This continues until some ultimate catastrophe or until it becomes actually impossible to be worse.

        But what I *hate* just as much, is those people who are taking those jobs with

    • Re:By comparison (Score:4, Insightful)

      by thoughtsatthemoment (1687848) on Monday May 31, 2010 @04:55PM (#32410688) Journal
      Nonsense. How can you compare workers with the general population?
      • by RAMMS+EIN (578166)

        ``How can you compare workers with the general population?''

        Well, why wouldn't you? And if conditions at Foxconn are indeed supposed to increase suicide rate, wouldn't you expect the suicide rate at Foxconn to be _higher_ than in the general population? I reckon that it would be more meaningful to compare the suicide rate of Chinese Foxconn employees to the Chinese general population than to the US general population, but still - wouldn't the numbers cited by the grandparent indicate that your risk of commi

    • Re:By comparison (Score:4, Insightful)

      by eulernet (1132389) on Monday May 31, 2010 @05:41PM (#32411282)

      The chinese don't commit suicide because they are too busy working overtime.

      Seriously, what is this pitiful statistics you are trying to use ?

      There have been 13 suicides at the working place, and, to my knowledge, suicides at the working place are very rare in our western countries.
      Frankly, if you work 18/7 and spend the rest of your time to sleep and eat, your life means pretty nothing after a few months. And only naive people believe that they can get rich by their work.

      BTW, in France, there have been 37 suicides in 2 years in the biggest telecom company: France Telecom, mainly because the company is changing (FT is becoming a private company, and I can assure you that it means a lot more work for some people there, who are accustomed to doing nothing !).
      In France, we count the suicides both at work and at home, as long as you are working for the company.

      • There have been 13 suicides at the working place, and, to my knowledge, suicides at the working place are very rare in our western countries.

        It would be interesting if the Foxconn home+work suicide rate is much different--do you know if it is?

        The fact that the suicide rate is highly correlated to cultural factors is obvious and well-known. It's partly linked to religion (some religious frown on suicide) and other more general cultural factors. Japan for instance has an _extremely_ high suicide rate. Beyond cultural, socio-economic realities also play a role.

        Maybe Foxconn families get more/different compensation in the family member committed sui

      • Re: (Score:3, Insightful)

        by Lars T. (470328)

        The chinese don't commit suicide because they are too busy working overtime.

        Seriously, what is this pitiful statistics you are trying to use ?

        There have been 13 suicides at the working place

        There have been 13 suicides at the Foxconn complex which also contains free housing for the employees.

    • I got curious as to how Foxconn's suicide rate compared to other groups. The United States' suicide rate [wikipedia.org] is 11.1 per 100,000 people. Foxconn employs somewhere around 800,000 people [economist.com](!) which means by the end of the year, you'd expect a death count by suicide of around 90 people.

      If the current rates holds, there'll be 50 more Foxconn employees alive at year's end than there will be Americans from a comparably sized city.

      Dammit, and here I was all excited that I could get a 20% raise if I could convince 13 coworkers to kill themselves.

  • By giving in, the people who committed suicide are getting exactly what they wanted, and will do this the next time they want a pay raise. Oh, wait...
  • Here we can strike.
    Though sometimes the police are brought in, it's hardly ever that bloody.

  • by shadowofwind (1209890) on Monday May 31, 2010 @05:18PM (#32410980)

    who said they worked 12 hour shifts with no days off.

    The excuses about labor supply and demand, and how the factory is an improvement over a Chinese farm, are bullshit. If it was really like that, they could cut pay in half, use 4 shifts instead of 2 (or whatever the current scheme is), and give the workers an option of working double. Or some other such improvement. As it is, its just an abuse of power. As screwed up as organized labor has been in the US, this is what happens when you don't have it at all.

    And yes, Apple is culpable, and so are all of us that own products by companies who use Foxconn. When a company is making profits, and its executives are earning large salaries and bonuses, the market isn't forcing them to do what they do. They can always scale back the size of their mansions a little bit.

    • by sjames (1099)

      As screwed up as organized labor has been in the US, this is what happens when you don't have it at all.

      Warning, irony overload!

      At least Apple appears to be making a move in the right direction.

  • Personally, I am not so sure giving the workers a raise is the most efficient way for the company to prevent the suicides. I have never known anyone to commit suicide simply because they felt they weren't making enough money. The more likely culprit, I think, is high stress levels - which may be caused by having trouble making ends meet due to inadequate wages, but would surely also be related to the working environment and the workload. Rather than raising wages by 20%, I would think that, say, hiring 20%

  • by Jackie_Chan_Fan (730745) on Monday May 31, 2010 @05:40PM (#32411258)

    Nuff said.

    When you outsource to foreign lands that force workers to sleep on the assembly lines, and in the factories... for 65 cents an hour, you're supporting slavery. (This is the common work condition of chinese labor)

    I'm sorry. Apple wanted to cheat the economic system by not hiring Americans, because we have lives and high expenses due to the cost of living in America. Why pay Americans who only want to work and have a home and healthcare, when you can hire Chinese slaves who are easily replaced no matter how many of them commit suicide.

    Fuck every corporation that sold America out.

    • I blame the lack of backbones in our governments that stops them standing up to the corporations.

      I take a simplistic view that selling products or services in a country takes money out of it and employing people in the country or sponsoring sports teams, etc., puts money back into the country. Therefore our governments should take the latter from the former and apply a huge tax to the difference. If all the rich governments did this overnight together, then there's nowhere the corporations could "hide" to a

      • You just described how capitalism should work. The problem is they cheated the ecosystem that is our economy. They went outside the cyclical nature of our entire economy. They rigged the game.

        Of course this only matters, if you actually care about your communities and neighbors.

        The ultra wealthy only have equally rich neighbors...

    • Fuck every corporation that sold America out.

      Oh please. Like it's all America's fault. Fuck the Chinese gov't for not protecting their workforce.

    • by pizzach (1011925)
      I agree with your attitude, but all of the companies that made product went out of business because people weren't buying them or had to start using foreign labor. I think the consumer is just at fault for this one. There is a reason why the Japanese buy so much Japanese made stuff.
  • by jcr (53032) <jcr@NoSPaM.mac.com> on Monday May 31, 2010 @05:51PM (#32411392) Journal

    The suicide rate among foxconn workers is not only lower than for the population of China in general, but also lower than every US state. Every suicide is a tragic event, but I'm not buying the contention that their jobs are driving them to do it.

    -jcr

    • Re: (Score:3, Insightful)

      by oddTodd123 (1806894)

      The suicide rate among foxconn workers is not only lower than for the population of China in general, but also lower than every US state. Every suicide is a tragic event, but I'm not buying the contention that their jobs are driving them to do it.

      Suicide rates vary widely between different population segments; you cannot fairly compare the suicide rate of factory workers in Shenzhen to the suicide rate of rural farmers, for example. The better comparison would be the suicide rate of Foxconn employees to the suicide rates at other electronics manufacturing, and I'd think if other factories had similar suicide rates we might not be hearing so much about this in the news.

      While these suicides may be due to statistical chance, do you not feel it is worth

      • Re: (Score:3, Interesting)

        by gmhowell (26755)

        Suicide rates vary widely between different population segments; you cannot fairly compare the suicide rate of factory workers in Shenzhen to the suicide rate of rural farmers, for example. The better comparison would be the suicide rate of Foxconn employees to the suicide rates at other electronics manufacturing, and I'd think if other factories had similar suicide rates we might not be hearing so much about this in the news.

        In a perfect and rational world, perhaps, but this world is neither. Witness how much makes news simply because it is Apple (or Nike, or whomever). This story gets play precisely because it does lob stones at Apple's glass house.

        This is like Greenpeace getting all pissy at Apple a few years back. Despite Apple being MUCH better than the industry average, Greenpeace targetted Apple, knowing it would garner more press than complaining about HP.

    • Re: (Score:3, Informative)

      by ahankinson (1249646)

      You read Fake Steve! [fakesteve.net] He totally called it that people would be saying this.

    • Re: (Score:3, Insightful)

      by SharpFang (651121)

      Is it lower than -workplace- suicides in any other part of the world?

      The number never included suicides at home!

  • by stbill79 (1227700) on Monday May 31, 2010 @06:03PM (#32411524)

    Remember this story the next time you try to defend our all-mighty corporations' choice of offshoring every single job possible with the simple-minded argument of American workers just can't compete; they need to toughen up, take a lower standard of living, work harder, become better educated, etc, etc...

    In a globalized world, there will always exist a shit-hole even worse than the last. Uless your idea of being more competitive really means accepting conditions so poor that death seems a valid alternative to a rather significant portion of the work-force, you might want to start thinking of a better argument.

It seems that more and more mathematicians are using a new, high level language named "research student".

Working...